The global commodity market saw significant declines in major agricultural products like corn, soybeans, and wheat. Favorable weather conditions and abundant supply from major producing countries have put downward pressure on prices, as confirmed by optimistic production forecasts from the U.S. Department of Agriculture (USDA).

1.Corn (December 2024 Futures - ZCEZ24)

Corn futures fell by 7.50 cents, settling at $408.25/ton. This drop was primarily driven by the USDA’s forecast of U.S. corn yields reaching 183.8 bushels per acre, exceeding previous predictions.

The large harvest, combined with favorable weather in Brazil—where the first corn crop is being planted—added pressure on prices. Additionally, USDA reports indicated a sharp increase in global corn supply, particularly from regions like Ukraine, despite concerns over Black Sea conflict disruptions.

2. Đậu tương HĐ tháng 11/2024 (ZSEX24)

Soybean prices decreased by 9.50 cents, reaching $996.00/ton. According to the USDA, U.S. soybean yields have been revised down to 53.1 bushels per acre, but production remains stable due to favorable weather in Brazil, the largest soybean exporter, where heavy rainfall has improved planting conditions.

Although consumption forecasts remain unchanged, the abundance of supply from South America has exerted further downward pressure on prices.

3. Wheat (December 2024 Futures - ZWAZ24)

Wheat experienced the steepest decline, dropping 13.75 cents to $585.25/ton. The USDA revised down U.S. wheat production while increasing global supply forecasts, particularly from Russia and Ukraine. Additionally, a stronger U.S. dollar has made American wheat less competitive internationally. Despite geopolitical tensions in the Black Sea region, Russian wheat exports have remained stable.

The agricultural market is facing immense supply-demand pressure. The USDA’s reports highlight high yields and strong production in the U.S., Brazil, and Ukraine, which is contributing to the overall price declines for corn, soybeans, and wheat. Furthermore, the strengthening U.S. dollar is exacerbating the situation by making U.S. exports more expensive.

The combination of favorable weather, ample supply, and stable geopolitical conditions in key export regions like Russia and Ukraine suggests that prices will continue to face downward pressure. For investors, it’s a time to tread carefully, as short-term market volatility could emerge from any unexpected disruptions.

4. Coffee

Global coffee production has been hit by adverse weather, particularly droughts in Brazil, the world’s largest coffee producer, coupled with less-than-expected rainfall in Vietnam.

Domestic coffee prices in Vietnam: According to giacaphe.com, prices in the Central Highlands range from 113,300 to 114,100 VND/kg, with an average of 113,800 VND/kg, up 500 VND/kg from the previous day. The highest price was recorded in Đắk Nông, while the lowest was in Lâm Đồng.

Global Coffee Market Update: The international coffee market is witnessing an upward trend in prices due to concerns over declining production. The supply of Robusta coffee from Vietnam and Indonesia is facing difficulties, while Arabica coffee production from Brazil has also been negatively impacted by ongoing drought conditions.

December 2024 Arabica Coffee Futures

The price of Arabica coffee for December 2024 delivery increased by 1.87%, reaching 254.73 cents/pound. This rise is mainly attributed to the limited supply from Brazil, where the drought has hindered the flowering process and reduced crop yields. The Arabica coffee market has been highly volatile in recent days, with prices fluctuating due to various international market factors.

November 2024 Robusta Coffee Futures

Robusta coffee futures for November 2024 also saw an increase of 2.92%, closing at 2,475 USD/ton. The key reason for this surge is the prolonged drought in major coffee-growing regions such as Vietnam and Indonesia, which has caused a reduction in Robusta supply, putting further upward pressure on prices.

These trends highlight the global concerns regarding coffee production, driven primarily by adverse weather conditions in key producing countries, which continue to affect both supply chains and market prices.

Source: Complied